Discussion question week 5: Financial Ratio Analysis Name Professor Course Date Part 1 Financial Ratios are of a great importance to any business organization. Even then the ratios may not exactly tell the truth about the status of the business especially when they were erroneously calculated. Precisely this article reflects on the advantages and the disadvantages of financial ratio analysis in an organization. The advantages Firstly financial ratios help to compare the performance of one business entity with another (Delen & Uyar 2013). Take for example hence stock will be moving fast (Delen & Uyar). Financial ratios are thus important to any business. However they should be calculated with utter precision and the management should use professionalism to manage issues other than wholly relying on the ratios because they might be disadvantageous at times. References Delen D. Kuzey C. & Uyar A. (2013). Measuring firm performance using financial ratios: A decision tree approach. Expert Systems with Applications 40(10) 3970-3983. Grant R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley & Sons. [...]
find two articles that discuss financial ratio analysis. Identify two advantages and two disadvantages to using ratios in financial analysis. Be sure to cite your sources using APA format. The video focuses on profitability, liquidity, efficiency, and stability of business. Given what you have learned about ratio analysis, choose one of the businesses from the video (Rose Chong Costumes, Anro’s Floor Maintenance, or John Osborne’s Gym and Squash Center) and identify two ratios that would be helpful for the owner of the business to monitor. Be sure to explain what the ratio would tell the owner, and how it can be improved for the business.